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GKP Shares Rise following Update

By John Lee.

Shares in Gulf Keystone Petroleum (GKP) closed the day up more than 5 percent on Wednesday, after the Kurdistan-focused oil producer provided an operational and corporate update to the markets.

Jón Ferrier, Gulf Keystone’s Chief Executive Officer, said:

“I am pleased to report that throughout 2020, Gulf Keystone successfully managed the challenging operating environment delivering record annual average production of over 36,600 bopd and in December, record monthly average production of over 43,000 bopd.

“Planned debottlenecking works have increased PF-1 production capacity to more than 30,000 bopd and the Company expects to deliver average gross production in 2021 of 40,000 to 44,000 bopd. We look forward to updating guidance once conditions allow resumption of the 55,000 bopd expansion.

“I would like to thank the team at GKP for their dedication and professionalism in what has been a challenging year for the E&P sector. I look forward to working closely with my successor, Jon Harris, to effect a smooth handover of responsibilities and I am confident of the continuing success of the Company.“

Operational

  • GKP’s continued strong focus on safety resulted in no Lost Time Incidents during 2020.
  • The Company has effectively managed to minimise the impact of COVID-19 on our staff and contractors and ongoing production operations.
  • In 2020, average gross production at Shaikan was 36,625 bopd, exceeding the top end of the guidance range and the highest annual average production rate to date from the field.
  • The previously announced PF-1 plant debottlenecking work has delivered production capacity in excess of 30,000 bopd.
  • As a result, Shaikan Field production has increased and is currently c.44,000 bopd.

Financial

  • Total cash received from the Kurdistan Regional Government (“KRG”) during 2020 for payments of crude oil sales was $129 million ($101 million net).
  • As a result of increased production and the recent improvement in the oil price, the December 2020 crude oil sales invoice submitted to the KRG was $18.0 million ($14.1 million net), up 65% from the previous month.
  • As at 12 January 2021, the Company had a cash balance of $147 million.

Corporate

  • Jon Harris to join as Chief Executive Officer and Board member on 18 January 2021.

Outlook

  • Guidance for 2021 is: 40,000 to 44,000 bopd average gross production, $15 to $20 million net Capex and $2.5 to $2.9/bbl Opex.
  • Guidance will be updated once conditions allow well workovers and/or the restart of the drilling programme to achieve 55,000 bopd.
  • Following receipt of the previously announced proposal to repay the arrears from the outstanding November 2019 to February 2020 invoices, totalling $73.3 million (net), the Company continues to engage with the KRG and will provide an update in due course.
  • The Company remains committed to maintaining its strong financial position and, as conditions continue to improve, will look to return to a balance of growth focussed field development investments and shareholder distributions.

(Sources: GKP, Yahoo!)

The post GKP Shares Rise following Update first appeared on Iraq Business News.

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Iraq Doubles Capacity at Salahuddin-2 Refinery

By John Lee.

The Iraqi Ministry of Oil has doubled capacity at its Salahuddin-2 refinery, part of the Baiji complex, from 70,000 barrels per day (bpd) to 140,000 bpd.

Speaking at the opening ceremony on Monday, Oil Minister Ihsan Abdul Jabbar Ismail said he plans to restore capacity at the plant to the 280,000 bpd level at which it was operating before it was damaged by the Islamic State group (IS).

(Source: Iraqi Ministry of Oil)

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Iraq signs $2bn Oil Deal with Chinese Firm

By John Lee.

Iraq has reportedly awarded a Chinese company a deal which would see it paying $2 billion upfront for a year’s supply of oil.

Alaa al-Yasiri, General Manager of State Oil Marketing Organization (SOMO) told Iraqi News Agency (INA) that a Chinese company had won the contract ahead of a European company, but did not identify the company.

Bloomberg had previously reported that China’s ZhenHua Oil was poised to sign the contract.

More here and here.

(Sources: Bloomberg, FT, INA)

The post Iraq signs $2bn Oil Deal with Chinese Firm first appeared on Iraq Business News.

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ShaMaran achieves 40m Barrels Production at Atrush

ShaMaran Petroleum has announced that the January 2021 interest payment due on its 12% senior unsecured bonds due 2023 (ISIN: NO 001082645.6) has been timely made to all Bondholders.

In addition, ShaMaran said the Atrush field total cumulative crude oil production has exceeded 40 million barrels.

The Atrush field is located 85 km northwest of Erbil and is one of the largest new oil developments in the Kurdistan Region of Iraq.

The field was first discovered in 2011 and oil production started in July 2017. In its fourth year of production, the Atrush field has sold all its production to the Kurdistan Regional Government of Iraq at international market prices less a discount based on quality and transportation charges.

ShaMaran President and Chief Executive Officer Dr. Adel Chaouch said:

“Following a challenging 2020 for the oil industry in Kurdistan, ShaMaran is pleased to start off 2021 with the full and timely payment of the semi-annual interest owed to our Bondholders.

“Our achievement of this 40 million barrel production milestone also demonstrates the ability of Atrush field to maintain stable production even through the past difficult times.  We look forward to future achievements.“

(Source: ShaMaran)

The post ShaMaran achieves 40m Barrels Production at Atrush first appeared on Iraq Business News.

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Jordan “negotiating New Oil Contract with Iraq”

By John Lee.

Iraq’s State Oil Marketing Organization (SOMO) has reportedly said that Jordan is negotiating with Iraq to resume purchases of crude oil.

Shafaq News Agency quotes the company’s Director, Alaa al-Yasiri, as saying that Iraq exported no crude oil to Jordan in December due to the expiration of the old contract.

More here.

(Source: Shafaq News Agency)

The post Jordan “negotiating New Oil Contract with Iraq” first appeared on Iraq Business News.

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GKP appoints New CEO

By John Lee.

Gulf Keystone Petroleum (GKP) has announced the appointment of Jon Harris as Chief Executive Officer (CEO).

Mr Harris has over 30 years’ experience in the oil and gas industry and joins GKP from SASOL Limited, an integrated energy and chemicals company based in South Africa where he was Executive Vice President, Upstream.

Prior to this, he spent 25 years with BG Group in various international roles, including Executive Vice President Technical and General Manager Production Operations, as well as senior management assignments in the United States, Trinidad and Tobago and Egypt.

Mr Harris received a Master of Engineering in Fuel and Energy (with distinction) from the University of Leeds, UK.

Mr Harris will join the Board of GKP and assume the CEO role on 18 January 2021.  He  will have a period of handover with Jón Ferrier who, as previously announced, will retire on 31 January 2021.

Jaap Huijskes, Chairman of the Company, said:

“Following a thorough global search process, I am very pleased to announce the appointment of Jon Harris as CEO.  Jon is an experienced executive who brings a wealth of highly relevant project delivery, asset management, production operations and technical experience within the sector to the management team and to the Board.  We look forward to him joining GKP and to his contributions. 

“On behalf of the Company, I would like to again thank Jón Ferrier for his outstanding commitment and contributions since joining Gulf Keystone in 2015. Under his leadership, GKP was successfully restructured and transformed, as evidenced by today’s strong operational performance, low-cost structure, robust financial position and pathway to further production growth and value creation.  We wish him the very best of success for the future.“

(Source: GKP)

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KRG proposes new Minister of Natural Resources

By John Lee.

The Prime Minister of the Kurdistan Regional Government (KRG), Masrour Barzani, has nominated Dr. Kamal Atroshi to the post of Minister of Natural Resources, a position which includes responsibility for the oil and gas portfolio.

A statement from KRG spokesperson Dr. Jotiar Adil said, “It is our hope that the Kurdistan Parliament includes this topic in its next session and provides a vote of confidence“.

According to his Linked-In profile, Dr al-Atroshi was educated in Iraq and France, and has worked extensively in the oil sector in Kuwait. He has held positions with the Kuwait Foreign Petroleum Exploration Company (KUFPEC), Gas & Oil Field Services Company (GOFSCO), and Total.

(Sources: Kurdistan Regional Government, Linked-In)

The post KRG proposes new Minister of Natural Resources first appeared on Iraq Business News.

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Iraq Increases Oil Exports for December

By John Lee.

Iraq’s Ministry of Oil has announced initial oil exports for December of 88,211,750 barrels, giving an average for the month of 2.846 million barrels per day (bpd), down from the 2.709 million bpd exported in November.

These exports from the oilfields in central and southern Iraq amounted to approximately 85,195,608 barrels, while exports from Kirkuk amounted to 3,016,142 barrels.

Revenues for the month were $4.213 billion at an average price of $47.765 per barrel.

November‘s export figures can be found here.

(Source: Ministry of Oil)

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